Lauren Stevens Chapter 7 Question 1

In this chapter, there is a section that addresses futures contracts. This affects everyones lives directly, but most people don't even know. In specific, it affects what we buy and how we buy. Using futures contracts, the price of a good is "locked in" as Wheelan puts it. Little do most people know that the price of the green beans they just bought have been set at that price for months, and it could've been higher or lower, but the farmer puts it at that price in order to have certainty that he or she will be able to pay the electricity bill. It affects how we buy in the terms of choosing the most resonable price point for the individual purchasing the good. Whoever is farming this good has to take into account where the food they have grown is going and that will affect their price point. If the green beans are organically grown and they're being sent to Whole Foods, they price will be much higher than traditionally grown green beans that are being sent to Target or Rainbow.